Ita Airways, the new industrial plan arrives. Now the final negotiations with Lufthansa-Corriere.it
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Negotiations between Treasury and Lufthansa on Ita Airways are in full swing. Between the end of next week and the beginning of the following week, the two industrial plans – one drawn up by the tricolor carrier, the other by the German one – of the Italian company in the period 2023-2027 will be examined. The mediation document will end up in the preliminary agreement which, barring any hitches, will be signed in the second half of March and which aims to bring the Cologne giant into the minority (40%). They tell the Courier government sources. Which also explain how there is no more time to lose and that Lufthansa has remained the last option to give the company a future.
The challenges
Experts point out that Lufthansa’s objective is almost miraculous: to make an airline profitable which in its previous life, Alitalia, almost never made a profit. But they recall that with this move the Germans would invest in a market – the Italian one – which is worth 19 billion euros (in 2019), they could bring a historic brand (Alitalia) back to the surface and use Rome Fiumicino as a hub for the southern hemisphere. With Linate and Malpensa, the group would expand its presence in an area that reaches 19.5 million people and 737 billion euro of GDP within a two-hour drive from the airports.
Trade agreements
In recent days, Lufthansa’s emissaries have been at Ita’s headquarters for others expert sessions. There is also the need to organize the operations of the interregnum which falls in the period where the sector registers the greatest gains: the summer season (end of March-end of October). French-American sources filter al Courier that Delta Air Lines and Air France-Klm have announced to Ita the stop to the collaboration that brings 270 million euros in revenues to the coffers of the tricolor carrier. This is why the Italian company could run for cover by signing one special prorate agreement with United Airlines and save 200 million.
Europe
Sources from the EU Competition Directorate-General explain al Courier that an informal confrontation has been started with the Italians and Germans on the dossier. The offices led by Commissioner Margrethe Vestager should give the go ahead between the second half of July and the beginning of August. The real business plan will take into account the corrections from Brussels which, almost certainly, will also concern the release of some slots at Fiumicino, Linate and Frankfurt. only at that point that Lufthansa will be able to start managing Ita, aiming immediately to reduce losses through commercial and industrial synergies.
Floors
The Germans want to make Rome Fiumicino the group’s fifth hub – together with Frankfurt, Munich, Zurich and Vienna -, fly Ita to Africa, expand it in North and South America. And it was the latter that returned to the fore with the decision of Iag (holding company of British Airways and Iberia) to take over all of Air Europa – present in that part of the globe – taking over the other 80% for 400 million. Air France-Klm’s offer for Tap Portugal is expected in the coming weeks.
The alliances
Not only. Once with Lufthansa in the shareholding, Ita will have to move to Star Alliance, one of the three maxi-alliances in the skies (the others are SkyTeam, where the Italian company is located today, and oneworld). But this will take a few months. The greatest benefits over the North Atlantic are expected from Ita’s entry into A++, Lufthansa’s transatlantic joint venture with United and Air Canada. The go-ahead, in particular from the US Department of Transportation, should arrive no earlier than summer 2024. The joint venture is the commercial agreement preferred by carriers because it allows those who join to plan routes, frequencies, timetables, tariffs together , managing customers and sharing, each for his part, costs, revenues and profits.
The opportunities
It should be noted that the war in Ukraine is pushing flows between North America and India (a booming market) to stop over in Europe because US and Canadian carriers cannot fly over Russia given the closure of the airspace to Westerners. This is why Ita – powered by Lufthansa – will also have to try to capture part of that traffic, getting them to Fiumicino earlier, perhaps collaborating not only with the Germans, but also with what should be the new overseas allies: Air Canada and United.
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